Warm welcome for Suharto -- but vexing issues lurk in the background

To hear American officials describe it, the relationship between the United States and Indonesia, the world's fifth-largest nation, could hardly be better.

In briefings for reporters, these officials have been paying the utmost in compliments to Indonesia's leader for the past 16 years, President Suharto. Suharto is described by officials here as a calm, resolute, and competent ex-military man who has led his huge island nation out of chaos and on to rapid economic growth and stability.

President Suharto meets with President Reagan on Oct. 12 in the course of a visit which, according to one senior administration official, symbolizes America's recognition of Indonesia's importance and its desire for even stronger relations with that nation of more than 150 million people.

The senior administration official went so far as to say that Indonesia has ''the potential to achieve major power status in Asia in the very near future - certainly by the end of this century - indeed a major status in the world.''

One critic of the Suharto regime, Benedict Anderson of Cornell University, a political scientist who specializes in Indonesian politics and culture, calls such talk of major power status, ''a lot of hot air'' aimed in part at flattering the Indonesians. Mr. Anderson points out that despite Indonesia's huge size, large population, and diverse natural resources, it remains a poor country with little industrial capacity, heavily dependent on outside aid. Indonesia also has a relatively small army and virtually no navy.

But flattery or not, it is clear that the Reagan administration considers Indonesia to be of major strategic importance. As John H. Holdridge, assistant secretary of state for East Asian affairs, explained at a recent congressional hearing, Indonesia is the largest country in the five-nation Association of South East Asian Nations (ASEAN), support for which is the cornerstone of US policy in the region.

''It is a moderate voice in the developing world, an important oil producer, and a major arena for US trade and investment,'' says Mr. Holdridge. ''And it occupies a strategic position astride vital sea lanes . . . .''

Despite the compliments being paid to Indonesia, however, there are strains and ambivalences in the relatiohship which have cast a few clouds over the bright picture painted by administration officials:

* Indonesia wants more American investment and wider access to American markets at a time when the US economy is depressd.

* While Indonesia officially supports ASEAN opposition to Vietnam, many Indonesians fear China more than they do Vietnam. The Indonesians were shaken by a Reagan administration decision to loosen restrictions on arms sales to China but were later reassured that such sales would be considered only on a case-by-case basis.

* Both the Indonesians and Americans have been embarrassed by the Reagan administration failure to send an ambassador to Indonesia for more than a year;

* The Indonesian invasion of the former Portuguese territory of East Timor in 1975 and subsequent famine there created concerns in the US Congress, which, instead of diminishing with time, seem to have increased. One reason for those concerns is that the Indonesians used US weapons in the invasion, in violation of an arms agreement with the US.

The Indonesians - as well as US State Department officials - argue that they have put more into the economic develoment of East Timor than they have into any Indonesian province. But reports persist of possible food shortages, human-rights violations, and resistance to Indonesian rule.

Various initiatives taken in recent weeks include: a call by a total of 102 members of Congress for the Reagan administration to devote more attention to the East Timor problem. A letter on Sept. 30 to Secretary of State George Shultz from Sen. David Durenberger (R) of Minnesota called for a full inquiry into events in East Timor and a survey of the situation by international relief agencies. The letter got bipartisan support from 16 senators, including several conservatives.

It was also learned that Sen. Barry Goldwater (R) of Arizona, chairman of the Senate Select Commmittee on Intelligence, recently informed Senator Durenberger that he was concerned about what he considered to be a disturbing situation in East Timor. Senator Goldwater said that if for some reason the Senate Foreign Relations Committee did not look into the matter, he would be prepared to take up some of the issues involved in hearings held by his committee.

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